Manufacturing missteps in Argentia

Ashley
Ashley Fitzpatrick
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The Midas touch gone, Myles-Legér winds up shuttering cabinet-making operation

Fourth in a five-part series

When Paul Power met Bill and Randy Clarke, the co-founders of developer Myles-Legér, he didn’t think much of it.

These days, he pays attention when their names come up in relation to the company’s bankruptcy and the outstanding criminal charges against the brothers.

The stories bring back memories for Power of the morning he was locked out of his workplace in Argentia. He worked for Millennium Manufacturing, producing everything from kitchen doors to stair treads. That company’s operations were taken over by Myles-Legér and the Clarke brothers.

Less than two years later, the company’s manufacturing plant was shut down.

“We arrived at work (at) eight o’clock I believe ... and at a quarter after eight we were told — there was a couple there at the time had keys to the building and things like that — and we were told to turn in our keys,” he said.

“That was the first notice we had of it.”

One of the least-discussed aspects of the Myles-Legér saga has been the company’s ties to that manufacturing operation.

Out of the gate, Myles-Legér gained a reputation for taking on large construction projects and covering the work on its own. Getting into subdivisions, the Clarkes supplied the company with its own cabinetry through a new subsidiary, Heritage Cabinets, incorporated in 2000.

They didn’t stop there and went looking to expand their manufacturing capacity, which led them to Millennium Manufacturing.

“The connection was that they were apparently going to purchase Millennium Manufacturing to make doors for Heritage (Cabinets), but they’d also sell to the general public,” Power said.

Millennium Manufacturing was established by Rick Fifield, Power’s boss.

“And from what I could understand from chatting with Rick, he had basically a verbal agreement, at least a verbal agreement and probably the makings of a business deal, with Myles-Legér,” Power told The Telegram.

Fifield died in 2011. The lawyer representing him on the manufacturing business has since retired and a representative from the lawyer’s firm said he is not able to discuss anything about the company, due to solicitor-client privilege.

Yet Fifield laid out his own story with Myles-Legér — as well as the closure of the Millennium Manufacturing operation — in a statement of defence filed with the Supreme Court in 2001. It was part of a civil suit in which he was named as a co-defendant.

He stated that four parties — Myles-Legér, Bill Clarke, Randy Clarke and Terry Reardon — took over the day-to-day operations of Millennium Manufacturing in January 2000. This included “placing one of their representatives as plant manager, generally directing all aspects of the business, ordering supplies, employing workers, shipping large amounts of produced materials, collecting various accounts receivable owing to Millennium, dealing with creditors and carrying out banking on behalf of Millennium.”

The Clarkes took over the lines of credit and were identified as the company’s owners to the Argentia Management Authority.

Fifield maintained a share in the business until, according to his statement, he was able to sell his shares to the others in May 2001.

The next month, however, he received a fax saying the Clarkes were giving up the company “and returning the corporate books and records of Millennium.”

In the five days leading up to that fax, he claimed the brothers had shut down the operation and “removed inventory and product, effectively shutting down Millennium’s business.”

Earlier in the year, in January 2001, Bill Clarke had told The Telegram Myles-Legér had signed a letter of intent to purchase the business, but was taking a month to complete due diligence, “to see if we are really interested in making the acquisition.”

The Atlantic Canada Opportunities Agency (ACOA) made no investments in Myles-Legér and key subsidiaries — Heritage Cabinets, Myles-Legér Construction and Legér Holdings.

But ACOA did put money into Millennium Manufacturing, providing a $125,000 loan to the company in January 2000. That loan was for the purchase of equipment for packaging, to allow products to be exported outside the province.

“In 2001, secured creditors took legal action against the company and called their loans,” a spokeswoman for ACOA said in an emailed response to questions.

“In 2004, following action in relation to their security, secured investors did not fully recover their investments. Consequently, outstanding obligations to unsecured creditors, including ACOA, were not satisfied.”

In other words, the public coffers were out the money.

The lawsuit for which Fifield gave his statement about Millennium and Myles-Legér was eventually settled out of court.

The plaintiff, Provincial Woodproducts, accepted a settlement agreement for two payments totaling $15,000. The first sum, $10,000, was paid as per the agreement but the other $5,000 was not. Provincial Woodproducts was forced to go back to the courts to get it in 2003.

Before it shut down, Millennium had customers all over the island.

“I can remember we had orders partially finished for customers and things like that, that were just left on the tables in the plant,” Power said.

The closure of the manufacturing plant left contractors scrambling to find new suppliers — adding time and cost to new home construction and renovations.

Customers were being put out.

All this did not sit well with the Argentia Management Authority (AMA), given that the business had been reportedly doing well in an area where developing new enterprises and jobs had been an uphill climb ever since the closure of the American naval base.

The AMA ultimately stepped into the fray and, with its support, a new company called Stellar Woodworks emerged the year after the closure of Millennium.

“We had a role in it in keeping the thing alive, keeping it going, keeping the jobs, of course — which is our mantra — and kept the operation going until it’s gotten to the point now,” said AMA business manager Chris Newhook in a recent interview.

The biggest challenge for the new wood products company was recovering from the hangover damage caused by the earlier enterprise at the same site, Power said.

“The reason Stellar Woodworks formed is because of the success of Millennium. We knew that the markets were there. That being said, when we opened up, I was — the first day Stellar opened I was production manager and it took me a year, year and a half getting back some of the customers we had lost because of Myles-Legér. Once bitten, twice shy — that kind of thing,” he said.  

“I knew personally some of the guys — you get to know ’em all down through the years — and some of the guys, they were probably purchasing a thousand, 2,000 doors from us, but we knew they were also probably purchasing doors from somebody else. They wouldn’t come with us solely, just in case the same thing happened again.”

Stellar Woodworks developed over time. The business has since moved into a new home in Argentia. It works with new equipment and was, in recent years, bought out by Custom Cabinets of St. John’s.

It employs about a dozen people.

 

Thursday: Gone, but not forgotten

 

 

Organizations: Millennium Manufacturing, Heritage Cabinets, Argentia Management Authority.Fifield Atlantic Canada Opportunities Agency Supreme Court Myles-Legér Construction

Geographic location: Argentia, Clarkes

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